Crouch is ready for the brickbats at Brickworks

Elizabeth Crouch attributes her resilience to extremely challenging career choices and a childhood spent travelling around Australia as her father climbed the ladder in the oil and gas industry.
Photo: PETER BRAIG

by
Michael Hobbs

It was a passing comment from
Maurice Newman
, former Macquarie University council chancellor and chairman of the Australian Securities Exchange, that caught
Elizabeth Crouch
’s attention.

Crouch, a fellow council member at the university, took his observations to heart. It became a mantra for her ­professional career.

“Never go into a situation that is plain ­sailing," Crouch recalls. “Being able to add value, particularly in things that are in a ­crisis or facing a difficult time, and still achieve a good outcome, is far more ­rewarding than going into something that is just ticking along."

The motto has led down some testing paths. She joined the NSW Public Transport Ticketing Corporation board in 2007 at a time when the project to overhaul and update the entire ticketing process was seven years behind schedule.

After just a few months Crouch became chairman of the board and subsequently re-tendered the massive infrastructure project. The end result is the Opal system which was successfully launched at the end of 2012.

Years earlier, as chief executive of the Housing Industry Association, she was on the front line when one of Australia’s largest insurers – HIH Insurance – collapsed, ­effectively halting large sectors of the ­building industry which were left ­underinsured overnight.

Crouch, 48, now faces one of her biggest challenges after being nominated as a director of the
Brickworks
board.

Behind Brickworks’s successful history manufacturing bricks and masonry across Australia for nearly 80 years, is an unusual corporate structure. Amid fears of a corporate takeover in the late 1960s,
Washington H Soul Pattinson
and Brickworks organised a share swap.

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The arrangement has only ­strengthened over the decades and, according to the companies involved, enhanced shareholder returns and enabled both companies to ride market cycles more effectively.

Today, Soul Patts owns 44 per cent of the brick company and Brickworks holds a 43 per cent stake in the investment conglomerate. The Millner family, led by chairman of both companies
Robert Millner
, also have substantial equity in both companies.

However, the second-largest independent shareholder of both companies, Perpetual Investments, has argued in recent years that the structure hides the true value of their ­collective assets.

In October last year, with Perpetual’s backing,
Mark Carnegie
launched his strategy to unwind the two companies and unlock the value Perpetual has consistently referred to. It comes after Perpetual head of equities Matt Williams granted Carnegie a $30 million option over their stock in December 2012. Carnegie is best known as the co-founder of boutique investment bank Carnegie, Wylie & Co with friend John Wylie, which he later left to pursue private equity incubation and investment opportunities with his own firm.

Last year, he launched a shareholder activist fund and his sights squared on the long-standing cross shareholding between Washington H Soul Pattinson and Brickworks. Part of the strategy is a motion to elect Crouch to the board and address their corporate governance concerns at Brickworks, particularly the perceived power of the ­Millner family.

It is a claim that Brickworks, and its independent directors, deny. Brickworks has not made a recommendation to shareholders for Crouch’s election, but in November last year the company raised a number of concerns regarding the nomination process.

‘You have to operate without fear or favour’

The Australian Securities Exchange has still not handed down its decision on whether Soul Patts is eligible to vote on Carnegie’s $2 billion break-up plan and Crouch’s election. If she is successful, Crouch is expected to face a cool reception from the Brickworks board members. Crouch, however, is unfazed.

“In any situation you have to operate how you always do; without fear or favour. You’re there for the best interests of the company and shareholders. You have to be judged on how you perform," she says.

“What I have learned over time that you go into a hostile environment like that, which I have done before, you just have to see if you can reach a level of understanding with people. Nine times out of 10 you will come up with a degree of commonality and then it’s the marginal stuff you argue about. Everyone has value to add, you just have to understand what value that is."

Crouch was approached by Carnegie to consider the role given her building and construction experience. Carnegie and Crouch both serve as non-executive directors on human resources and recruitment firm
Chandler Macleod
.

“Working back in the sector attracts me to the role but I am committed to good governance and the opportunities to work with companies that are looking through these sorts of issues," she said.

“If you look at the performance of companies that have been able to make that sort of change, in terms of the mix and skills, they have performed far better."

Despite her association with Carnegie and therefore Perpetual, Crouch is ­adamant she will act in the interests of all shareholders.

“I will be the best advocate for the broader group of shareholders and the company to ensure the company’s success. I will act independently and that is the way I have always operated," she says.

It’s a sense of determination, Crouch says, was borne out of a life of persistent change. She and her sisters travelled around ­Australia for much of her childhood and adolescence as her father moved up the ranks at Ampol, Air Liquide and CIG in the oil and gas industry.

Her mother, also a small healthfood operator throughout that time, has also been a significant role model for her.

“When I look at people I know who have been in a similar situation, they are resilient because you have to be. While I resented it at the time it was a great gift to me," she says.

Crouch has a family of her own with ­husband Paul and 16-year-old son Sam. When she’s not driving Sam to school sport, she can often be found watching her other passion – cricket.

“I am an avid cricket tragic. My son is still playing cricket. I used to sit up late at night with my father watching international cricket," she says.

It may be months before Crouch finds out her fate regarding Brickworks. The extraordinary general meeting has been postponed again until April 10 and, at the same time, legal proceedings between Brickworks and Carnegie are ongoing.

Crouch, regardless, is primed for whatever shareholders decide.

“I am used to operating at 110 miles per hour. I’ve had a corporate career for a very long time and I managed a six-month-old baby with a CEO role. I can do this," she said.